San Diego County District Attorney Bonnie Dumanis, together with 42 other California District Attorneys and two city attorneys, announced on Dec 13 that a judge in Alameda Superior Court has ordered the Illinois-based Walgreen Company to pay $16.57 million as part of a settlement of a civil environmental prosecution.

Walgreens was accused of illegally dumping hazardous waste and confidential customer medical information. The civil case was filed by the District Attorneys of Alameda, Riverside, San Joaquin, Solano, Monterey, Yolo and the City Attorney of Los Angeles. The lawsuit contended that more than 600 Walgreens stores throughout the state including 36 in San Diego unlawfully handled and disposed of hazardous waste for more than six years.

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The settlement also resolves allegations that Walgreens unlawfully disposed of customer records containing confidential medical information without preserving confidentiality. All 36 Walgreens stores in San Diego County were involved in the violations.

The records disposal problems really came to the public’s and regulators’ attention in 2006 in a series of articles by WTHR in Indiana. Since then, Walgreens has been investigated and/or charged by state and federal agencies over improper disposal of customer medical/pharmacy records. Indiana’s Attorney General started filing charges against Walgreens in 2007, and that case settled in 2009. Ironically, perhaps, Walgreens issued the following statement:

“We are glad to reach this agreement and believe we have always followed HIPAA standards. We have sound practices and policies that protect our patients’ information, and we will continue to adhere to them.”

Sound practices and policies? And they continued to adhere to the very practices and policies that didn’t work? No wonder problems still occurred too frequently in 2011.

Frankly, given all the reports of improper disposal, and having already settled one case (Indiana) and while dealing with OCR and FTC over improper disposal, I find it somewhat stunning that Walgreens has not really addressed the problem adequately. The California case was based on inspections conducted during the summer and fall of 2011, and “34 of 37 Walgreens stores were in violation of state law, including three retailers investigated in San Diego County.”

Whatever Walgreens has been doing since 2006 to clean up its act, it appears to be woefully insufficient. Maybe getting socked with a big fine – even though I don’t know what portion of it was for the customer records issue – may get them to change what they’re doing and ensure that stores protect the privacy of consumers’ medical information. If not, they may find themselves perpetually or repeatedly under investigation or getting hit with fines.